South Jeolla-Gwangju merger fund of 20 trillion won to focus on semiconductor infrastructure

"If necessary, we will go all in on nurturing the semiconductor industry."

The 20 trillion won in government support tied to the launch of the integrated South Jeolla-Gwangju Special City will be channeled into semiconductor industry development.

President Lee Jae Myung made the pledge Monday at the "Three Major Mega-Projects National Briefing for Korea's Great Leap Forward," held at Cheong Wa Dae. "Large-scale regional investment is not about forcing losses and risks onto companies to achieve national goals, as some have worried," Lee said. "It is the government's job to deploy its full capacity so that companies can invest without taking losses and with a better outlook."

Lee said building a large-scale industrial belt requires massive infrastructure support. "The central government alone cannot do it — local government matching is needed," he said. "Fortunately, the Gwangju and South Jeolla region has indicated it is willing to commit anywhere from 5 trillion won ($3.24 billion) to the full 20 trillion won toward investment, which gives me considerable room to act."

The government has pledged up to 5 trillion won per year over four years — a total of 20 trillion won — to the South Jeolla-Gwangju Special City, which will be established through the merger of the two metropolitan authorities. It plans to direct that funding toward building investment infrastructure.

Min Hyeong-bae, the mayor-elect of the South Jeolla-Gwangju Special City, also pledged the city's full backing.

"The South Jeolla-Gwangju Special City will prepare strong incentives," Min said. "We will put together concrete support measures that companies can actually feel." He added that the city would commit at least 5 trillion won — and all 20 trillion won if needed — from the government's promised integration fund to firmly underpin semiconductor investment.